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Nagpur-based Diffusion Engineers filed a draft red herring prospectus (DRHP) with capital markets regulator SEBI on January 1 to raise funds through an initial public offering (IPO).
The IPO only involves a fresh issue of 98.47 lakh shares by the company.
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The engineering solutions provider will utilize the net issue proceeds primarily for expansion of its existing manufacturing facility in Nagpur's Khasra at a cost of Rs 66.6 crore and for setting up a new manufacturing facility in Nagpur's Sonegaon at a cost of Rs 30.38 crore.
The remaining amount will be used for working capital requirements, estimated at around Rs 22 crore, and for general corporate purposes.
Unistone Capital is appointed as merchant bank for the issue.
Also read: The top five winning IPOs on listing day in 2023
Diffusion Engineers, which makes specialty welding consumables, wear plates and heavy engineering equipment for core industries, posted a consolidated net profit of Rs 22.15 billion in the financial year ended March 2023. This marked a jump compared to Rs 17 billion in the previous fiscal .
The company's consolidated operating revenue increased to Rs 254.9 crore in FY23 from Rs 204.6 crore in FY22.
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Also read: 5 IPOs that experienced the worst listings in 2023
In the first quarter of fiscal 2024, net profit was Rs 6.25 crore and revenue was Rs 65.8 crore.
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